Re: Consultants:Dim or Delete the Non-Compete?

Subject: Re: Consultants:Dim or Delete the Non-Compete?
From: Andrew Plato <intrepid_es -at- yahoo -dot- com>
To: "TECHWR-L" <techwr-l -at- lists -dot- raycomm -dot- com>
Date: Fri, 15 Mar 2002 09:11:06 -0800 (PST)

--- "tom -dot- green -at- iwon -dot- com" wrote

> When I noticed the non-compete clause in my current contract position I
> almost walked out in frustration but, I needed the job. Why did I react that
> way? I immediately saw it as an illegal restriction that will hinder my
> ability to make a living. I understand the need for a headhunter to protect
> him/herself but if I am a good contractor here and the company comes up with
> a permanent position, I should not have to "pay off" someone who sits and
> collects money from my work (which is a source of frustration that is another
> story).

It isn't illegal at all. It would only be illegal if they hindered you from
getting work at other places.

An agency has a right to protect its business relationships with their
customers. Remember, you are an employee of the agency, not the company where
you're working. Therefore, if the company wants to hire you, they have to buy
you out of the agency.

You cannot use agencies as your unpaid, personal marketing team. If you want a
full time job, then apply for full-time jobs. If you want to contract
independently, then market your services directly to companies. But if you want
somebody else to do this work for you (namely an agency) then you have to pay a
price. That price is reduced hourly rate and non-compete agreements.

Likewise, if companies wanted to avoid agency fees and buy-out charges they
would contract people directly. But since this poses many legal risks, they
don't. So, you either play the game or suffer the consequences. You can't have
your cake and eat it too.

> I'm sure, unless the company sees me as an "invaluable" asset, it
> will think twice about hiring me fulltime if it has to fork over a bunch of
> cash to do so. I almost want to have the opportunity to challenge the
> legality of non-compete clauses in court but I need to pay the bills.

It isn't illegal. There has been many challenges to non-compete agreements and
they have not been successful.

Its actually a pretty simple agreement. You are getting a contract job in
exchange you are agreeing not to pursue independent work with the customer for
a period of time.

If non-compete clauses bother you, then you should become an independent
consultant and stop working with agencies.

Andrew Plato


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